Robert Half Posts 3.8 Percent Revenue Increase
February 4, 2020 – Robert Half International Inc./(NYSE:RHI) posted full-year revenues of $6.074 billion, up 3.8 percent from $5.80 billion the prior year. The Menlo Park, CA-based recruiting company posted fourth quarter revenues of $1.48 billion, up slightly from $1.48 billion last year.
For the year, net income was $454 million, or $3.90 per share, compared to earnings of $434.3 million, or $3.57 per share, the prior year. In the fourth quarter, Robert Half posted earnings of $113 million, or $.98 per share. The results exceeded Wall Street expectations. This was in line with the Zacks Consensus Estimate.
“We ended 2019 with continued strength in the U.S. job market and solid demand for our professional staffing and consulting services,” said M. Keith Waddell, CEO of Robert Half. “We are particularly pleased with how Protiviti performed during the quarter. Our Robert Half Technology and Robert Half Management Resources divisions also turned in solid results, largely due to ongoing talent shortages in the professional disciplines they serve. Return on invested capital for the company was 40 percent in the fourth quarter.”
Segment Details
Global Staffing Division: Staffing revenues of $1.23 billion increased 1.2 percent year over year on a reported basis and 2.1 percent on an adjusted basis. U.S. staffing revenues of $962 million increased three percent on a reported basis and 3.2 percent on an adjusted basis. Non-U.S. staffing revenues declined 4.8 percent on a reported basis and 1.5 percent on an adjusted basis to $271 million.
Protiviti: Protiviti revenues were $304.7 million, which increased 15.7 percent year over year on a reported basis and 14.1 percent on an adjusted basis, with strength across the U.S. and non-U.S. regions. Protiviti revenues from the U.S. grew 17.3 percent on a reported basis and 17.5 percent on an adjusted basis. The same from international regions rose 10.4 percent on a reported basis and 3.3 percent on an adjusted basis.
Management Change
In November, Robert Half appointed Mr. Waddell as its new CEO. He succeeded Harold M. Messmer Jr., who held the position for 33 years. Mr. Messmer, one of the longest serving recruitment chief executives, will continue as executive chairman.
Mr. Waddell is currently vice chairman, president and CFO, leading Robert Half’s finance department for more than 30 years. Paul F. Gentzkow, a 30-year veteran of the company who has served for many years as president and chief operating officer, staffing services, will become president and CEO, staffing services. Lastly, Michael Buckley, a 22-year veteran of the company, will be promoted from executive vice president, treasurer, to executive vice president, CFO. Joseph Tarantino, a veteran of 17 years, will continue as president and CEO of Protiviti, a Robert Half subsidiary.
“Robert Half is fortunate to have great management continuity among our top executives and the experienced leaders of our field operations worldwide, who together average more than 20 years with the company,” said Mr. Messmer. “When I assume my new role as executive chairman next month, I look forward to supporting this outstanding team in the future as it continues to grow the Robert Half business.”
Moving forward, Mr. Messmer will devote significant time to board matters as well as growth plans, business strategy and the professional development of the company’s employees throughout the organization.
Executive Search Firms Expect Revenue Uptick, Continued Growth in 2020
A new year brings a new set of perspectives and priorities. In 2020, search consultants are excited about the possibilities provided by technology, anxious about the economy, and (still) struggling with the talent shortage.
Expectations for 2020 are largely positive but are more modest than in years past, according to Bullhorn’s “Global Recruitment Insights and Data” report. This is likely connected to economic uncertainty with 45 percent expecting a recession in 2020, compared to just 30 percent heading into last year, said the study. Overall, 64 percent of respondents named economic uncertainty as their top macroeconomic challenge for the coming year, up from 49 percent last year.
“We are extraordinarily fortunate that Mr. Messmer will continue as executive chairman and will remain involved in areas that are most important to Robert Half’s continued growth,” said Frederick A. Richman, the company’s lead outside director. “We are equally fortunate that Mr. Waddell will serve as CEO and that we have the benefit of an outstanding team of other executives, most of whom have at least two decades of experience with the company.”
New Director & Product Launch
Robert Half recently elected Julia Coronado to its board of directors. Ms. Coronado is president and founder of MacroPolicy Perspectives, which provides economic research on monetary policy and global macroeconomic developments. A noted financial market commentator and labor expert, she previously served as chief economist for Graham Capital Management, chief economist for North America at BNP Paribas and senior U.S. economist at Barclays Capital in New York.
The Menlo Park, CA-based recruiting company’s Protiviti division also recently launched a cyber-risk quantification as a service offering in alliance with RiskLens, a provider of quantitative cyber risk management software. Through quantitative risk analysis using hard data, the offering enables CIOs and CISOs to answer their board of directors’ questions about the effectiveness of their cybersecurity program with confidence, make better decisions about budgets and technology investments, and assist in meeting regulatory requirements.
“Protiviti’s Cyber Risk Quantification service, powered by the RiskLens Platform, delivers a continual, data-driven assessment of an organization’s current state of cyber risk,” said Andy Retrum, a Protiviti managing director. “Armed with this data, cybersecurity teams are able to better manage risks in business terms, determine if they are investing their cybersecurity budgets in the right areas and if they have sufficient cyber insurance, evaluate ROI and provide meaningful insights to senior leadership and the board.”
Contributed by Scott A. Scanlon, Editor-in-Chief; Dale M. Zupsansky, Managing Editor; and Stephen Sawicki, Managing Editor – Hunt Scanlon Media
